AS a second round of GFC mayhem hits financial markets and depresses prices for most assets, savvy investors are looking around for bargains.
They're not only looking at undervalued shares but also to collectable items. One area where value is appearing is prestige heritage numberplates.
"At this point plates are very cheap," says Scott Thompson, a plate collector and investor who runs internet sites reselling heritage number plates. "I think they have probably hit the bottom and, really, the only place they can go is upwards now."
But some heritage plates provide better value than others.
Personalised plates have boomed in Australia, with many state governments selling plates that can have anything from your name to your favourite sports team. But most experts agree they are not great investments, partly because most personalised plates are tailored to individuals and therefore don't have a broader resale market.
Heritage plates attract the serious investor and are best for long-term appreciation. They (not the original plates but the right to display them) are the first plates issued last century when cars became registered. Governments created a stockpile of the plates when people handed them back over time. They were reissued in the mid-1980s in "great plate auctions".
Typically, the lower the plate's number the greater its value. Other valuable plates have sequential numbers, as do number repeats. There is a premium for plates carrying the number 8 because of demand from Asian investors who see favourable connotations in the number. NSW and Victoria are the dominant and most expensive markets.
The rarity of heritage plates attract huge sums at auctions. The Victorian government sold its No 1 plate for $165,000 and it is now reputedly worth between $2 million and $3 million. Q1, the first Queensland plate, is owned by hairdresser Stefan and is worth more than $1m.
A raft of famous Australians have bought heritage plates to adorn their cars. They proved to be a good investment. Some experts estimate the market for heritage plates in NSW and Victoria soared tenfold from 1983 to 2007.
But since the GFC their prices have stalled. "The past two years have definitely slowed down," says James Nicholls, head of collectors' motor cars at Sothebys Australia. "It was really hot about five to six years ago."
Nicholls says the heritage plate market has been hit not only by the GFC but by over-trading of plates. "It ought to be viewed as a long-term thing," he says. "When prices got hot people started to trade them very quickly." He says the heritage market is a small environment and people saw that the same plates were continually on sale which diminished their value.
Attracting strong prices because they're considered exciting and interesting are heritage plates that are fresh to the market after, for example, having been in the same family for 40 or more years, Nicholls says.
Recent auctions in NSW and Victoria have showed a softening of the market, but prices aren't in free fall. In NSW at an auction on July 24, the plate 439 sold for $95,000 against estimates of $85,000 to $95,000; and the plate 18086 sold for $14,750 against estimates of $9000 to $12,000. In Melbourne a series of plates sold at the lower end of estimates of between $45,000 to $70,000.
"There were some OK prices but perhaps not as much as people were hoping to get," Nicholls says of the auctions. "Maybe those numbers have been around for a while."
Thompson says Queensland heritage plates have suffered the biggest falls but still offer the best value. He recently sold Q23 for more than $100,000, a strong price in this market, but he estimates it would have sold for $150,000 to $180,000 just three to four years ago.
Thompson says a four-digit plate in NSW will fetch about $30,000, in Victoria $15,000 and South Australia, which has experienced consistent growth, between $7000 and $10,000. But a four-digit plate in Queensland will go for just $4000 to $5000. "That's where I think the potential investment value is, in Queensland," Thompson says. "You've got a lot less to lose as well."
Nicholls says there are probably some comparative bargains to be had with heritage plates. "They have historic significance and they're not going to be repeated, so they have some meaning and some intrinsic value so they could potentially be a good investment. But it's about being a collector rather than being an investor."
Thompson is more bullish: "It is a great time to buy; a sensational time to buy for guys who have a spare few grand [and] want to spend on something with good investment value."